Hi all, it’s Eric.
The Binary Capital revelations over the past week have been disturbing.
The founder of the up-and-coming e-commerce company Stitch Fix, Katrina Lake, was allegedly harassed by the now disgraced venture capitalist Justin Caldbeck. And then Lightspeed Venture Partners, where Caldbeck worked at the time, had Lake sign a non-disparagement agreement. Lightspeed allowed Caldbeck to keep the allegations a secret. The firm wrote on Twitter, “In light of what we have learned since, we regret we did not take stronger action. It is clear now that we should have done more.”
Bloomberg reported Wednesday evening that Former Binary Capital principal Ann Lai is suing Binary Capital for harassing and defaming her after she resigned. After Lai quit the firm, Caldbeck wrote that he wasn’t going to “warn” her again. “Please stop and don’t add ill will. It didn’t work out. I have egg on my face for supporting you and I’m sure you are disappointed w your experience but don’t put us in a situation where we need to be more aggressive,” he wrote on the messaging app Confide, according to Lai’s complaint.
You can be certain that offices up and down Sand Hill Road are discussing how accusations against Caldbeck were handled over the years. Partners have said to me that they’re highly disturbed, if not altogether surprised. For one, non-disparagement agreements are the norm in the industry: it’s no surprise that Lightspeed tried to put the allegations behind it. Given the blowback Lightspeed is getting to how it handled the situation, venture firms might think twice in the future about staying quiet about bad actors.
There’s so much that’s unsettling about the…